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vanguard settlement fund

pnwoldie
pnwoldie Member ✭✭
edited November 2018 in Investing (Windows)
I am using Quicken Deluxe 2018 on Windows 10.  I bought some shares of a Vanguard fund using the Vanguard Prime Money Market Fund (the sweep or settlement fund) as the source.  Instead of processing it like any other transaction, Quicken did not remove the amount from the source account, but instead entered the amount of the trade as a negative cash balance.

So for example, I purchase $1,000 worth of FundX, which is recorded correctly.  But the Vanguard Federal Money Market Fund (Settlement Fund) still shows $1,000 in it, although it is zeroed out by a -1,000 cash balance.  Although to be completely accurate, it shows slightly less than $1,000 in the account because Quicken seems to be adjusting the share price slightly.

How can I get this transaction to happen like it is supposed to?  Thanks in advance.  In the past I have deleted the account and re-added it, but I am tired of that workaround because it loses history.

Comments

  • Vetta
    Vetta Member ✭✭
    edited May 2018
    Check your Holdings screen. Did you set up the Vanguard Prime Money Market Fund as a mutual fund? If so Q does not see this as cash. You will need to enter a Sell transaction @ $1/sh from the MMF first to create a cash balance.

    Or, and this is my preference, simply ignore the MMF as a fund and treat it as cash. Sell all shares of the fund @ $1 and leave the cash balance in your Q account register. If you download from Vanguard in the future you would have to change the ReinvDiv to just Div to keep the balance accurate, but this eliminates the need to enter Sells every time you make a purchase.

    Does that solve it? 
  • Jim_Harman
    Jim_Harman SuperUser ✭✭✭✭✭
    edited November 2018
    Pnwoldie,



    What type of account do you have at Vanguard? Is it a legacy mutual fund account, which can only hold Vanguard mutual funds, or a newer brokerage account?



    And what transaction did you enter st vanguard? Was it an Exchange, to move money from one Vanguard fund to another, or a Buy, which in a brokerage account uses money from the settlement account for the purchase?
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  • pnwoldie
    pnwoldie Member ✭✭
    edited February 2018
    Jim,
    My accounts all say "brokerage"  on the Vanguard page.  The transaction was a Buy with the settlement fund as the source.  
  • pnwoldie
    pnwoldie Member ✭✭
    edited February 2018
    Vetta said:

    Check your Holdings screen. Did you set up the Vanguard Prime Money Market Fund as a mutual fund? If so Q does not see this as cash. You will need to enter a Sell transaction @ $1/sh from the MMF first to create a cash balance.

    Or, and this is my preference, simply ignore the MMF as a fund and treat it as cash. Sell all shares of the fund @ $1 and leave the cash balance in your Q account register. If you download from Vanguard in the future you would have to change the ReinvDiv to just Div to keep the balance accurate, but this eliminates the need to enter Sells every time you make a purchase.

    Does that solve it? 

    Vetta,
    The settlement fund is a mutual fund, VMFXX Vanguard Federal Money Market Fund.  The fund comes as a holding when I download the account holdings from Vanguard.  The account also has the same ticker, VMFXX as a holding and calls it Vanguard Prime Money Market Fund.  This all started quite a while ago when Vanguard added this settlement fund per some new regulation, they said.  

    Are saying sell the MMF in Quicken? I wouldn't know how to sell it in Vanguard because it seems like it would just be selling it to itself.  

    Here's screen capturesimage
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  • q_lurker
    q_lurker SuperUser ✭✭✭✭✭
    edited November 2018
    Vetta said:

    Check your Holdings screen. Did you set up the Vanguard Prime Money Market Fund as a mutual fund? If so Q does not see this as cash. You will need to enter a Sell transaction @ $1/sh from the MMF first to create a cash balance.

    Or, and this is my preference, simply ignore the MMF as a fund and treat it as cash. Sell all shares of the fund @ $1 and leave the cash balance in your Q account register. If you download from Vanguard in the future you would have to change the ReinvDiv to just Div to keep the balance accurate, but this eliminates the need to enter Sells every time you make a purchase.

    Does that solve it? 

    The account also has the same ticker, VMFXX as a holding and calls it Vanguard Prime Money Market Fund.  

    a)  The ticker I have for the Prime is VMMXX.  I believe they are two distinct funds, FWIW.  

    b) With respect to Jim's question, you are dealing with the "newer brokerage account" Vanguard implemented perhaps a year+ ago.  I am not widely experienced at this point with these "newer brokerage accounts" but I believe Vanguard does not send the VFMXX transactions but they do send Holdings information about VFMXX.  That is something of a discontinuity on their part.  

    Two options for the Quicken user:
    1)  Since transactions are not downloaded, do not treat the sweep/settlement fund as a fund.  Do not record any transactions for that fund.  The cash balance in Quicken should always match the VFMXX fund value shown by Vanguard.  Taking that route, I expect Quicken will always report a portfolio mismatch.  You would choose to ignore it if the numbers were correct.  (This is the option Vetta prefers.)

    2)  Since Vanguard is reporting VFMXX as a holding but not transactions, you can enter the sweep transactions yourself.  Buys and sells as necessary to have the cash balance of $0 at the end of the day (or week or month - however frequently you choose to).  Taking that path, the portfolio comparisons between Quicken and Vanguard should match.  If they don't, locate the problem and fix it    
  • Vetta
    Vetta Member ✭✭
    edited November 2018
    Vetta said:

    Check your Holdings screen. Did you set up the Vanguard Prime Money Market Fund as a mutual fund? If so Q does not see this as cash. You will need to enter a Sell transaction @ $1/sh from the MMF first to create a cash balance.

    Or, and this is my preference, simply ignore the MMF as a fund and treat it as cash. Sell all shares of the fund @ $1 and leave the cash balance in your Q account register. If you download from Vanguard in the future you would have to change the ReinvDiv to just Div to keep the balance accurate, but this eliminates the need to enter Sells every time you make a purchase.

    Does that solve it? 

    Yes, I am saying I would sell the fund in Q and just show the cash balance, ignoring the fact that it is in a MMF in Vanguard. And q.lurker is correct-- Q will keep telling you there is a mismatch, but as long as the mismatched cash = mismatched shares your account is accurate.
  • pnwoldie
    pnwoldie Member ✭✭
    edited February 2018
    Vetta said:

    Check your Holdings screen. Did you set up the Vanguard Prime Money Market Fund as a mutual fund? If so Q does not see this as cash. You will need to enter a Sell transaction @ $1/sh from the MMF first to create a cash balance.

    Or, and this is my preference, simply ignore the MMF as a fund and treat it as cash. Sell all shares of the fund @ $1 and leave the cash balance in your Q account register. If you download from Vanguard in the future you would have to change the ReinvDiv to just Div to keep the balance accurate, but this eliminates the need to enter Sells every time you make a purchase.

    Does that solve it? 

    I do appreciate the advice.  I hoped the upgrade to 2018 would solve this problem and my other issue, which is that 2015 would not connect to my credit union since they did some upgrade last year.   Quicken 2018 connects to the CU and reports downloaded transactions, but they never appear.  

    So I will go back to my workarounds:  deleting and adding the Vanguard accounts, and manually importing the transaction files from the credit union.  Since 2015 is being sunsetted in April I would have had to upgrade anyway.

    Quicken long ago failed to be useful in keeping the history of my retirement accounts, because of this or that occasional snafu that would cause me to start over with another Quicken file, or add and delete various accounts.  I use it for a fairly convenient way to update my checking, savings and credit card accounts to easily see my debts and assets and get a point-in-time picture of my net worth.  

    I researched other solutions, and tried Personal Capital but that had problems connecting with my credit union also, and there was no manual workaround.  Plus they hounded me trying to give advice and hire them to manage my money.  

    So I guess I will just limp along with Quicken.  The other thing I like about it is that my data is local.  Not comfortable having information with access to my accounts in the cloud.  Encrypted or not.  Also, I like the new reports that track spending and plan to carefully categorize transactions so that will work.  
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